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2023 Audit Regulatory Transparency Report

Deloitte & Touche LLP (Kenya)

We have deliberately set the bar high for ourselves and this report describes some of the principles, policies, standards and actions we have implemented to support our commitment to leading the profession.  

This report sets out the practices and processes that are employed by Deloitte & Touche Kenya, for the period 1 June 2022 to 31 May 2023. The report has been prepared in accordance with the requirements of the European Union’s Regulation 537/2014 on specific requirements regarding statutory audit of public-interest entities

Previous Reports

IFRS 16 Leases Updates 2020

Welcome you to IFRS 16 Latest developments, a  snapshot of the recent amendments to IFRS 16 Leases, as well as some other relevant topics.

  • Due to Covid-19 many lessors have granted rent concessionsto their lessees. In the first part of this publication, we analyse thechallenges lessees and lessors may face when accounting for theseconcessions,  and the IASB’s response in alleviating some of them.
  • Covid-19 has numerous accounting impacts. We bring yourattention  to the potential effect on the carrying value of Right of UseAssets under IFRS 16 and impairment considerations.
  • Lastly, a non-Covid-19-related update: the IASB continuesits IBOR  reform project and has issued an Exposure Draft proposing toamend,  amongst others, IFRS 16.

IFRS 16 Lease Updates 2020 - Download Report

Qualifying criteria

Lessees may elect to apply a practical expedient if the rent concession meets the following criteria. In this case, lessees won’t have to assess whether the rent concession is a modification and won’t have to apply modification accounting.

  • The rent concession needs to be a direct consequence of Covid-19;
  • The revised consideration for the lease is substantially the same as, or less than, the consideration for the lease immediately preceding the change;
  • Any reduction in lease payments affects only payments originally due on or before 30 June 2021 (even though subsequent increases can fall beyond that date); and
  • There is no substantive change to other terms and conditions of the lease.

Interest Rate Benchmark Reform – Phase II 2020

The International Accounting Standards Board (“IASB”) published Interest Rate Benchmark Reform Amendments to IFRS 9, IAS 39 and IFRS 7 representing the finalisation of Phase II of the project on 27 August 2020 to address issues that might affect financial reporting when an existing interest rate benchmark is replaced with an alternative benchmark interest rate, i.e. replacement issues.

The accounting issues arising before an existing interest rate benchmark is replaced with an alternative risk-free rate, i.e. pre-replacement issues, have been considered previously by the IASB and were addressed in Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7), published in September 2019 (“Phase I amendments”). This Phase I amendments provide temporary exceptions to specific hedge accounting requirements, to avoid entities having to discontinue hedging relationships solely due to the uncertainty arising from the reform.

The Phase II amendments discussed in the following slides compliment, do not supersede, the Phase I amendments. The Phase II amendments apply to all entities and are not optional and effective for annual periods beginning on or after 1 January 2021 with early application permitted. The amendments are applied retrospectively and include the potential reinstatement of hedge relationships that were discontinued solely due to changes directly required by the reform.

Interest Rate Bench Mark ReformDownload Report